Section 1 Transition to an Intellectually Creative Society Based on Info-Communications Japan confronts a range of problems as it stands on the verge of the 21st century. To resolve these problems and build an intellectually creative society based on info-communications leading to the next century, it is imperative that Japan now take an approach that emphasizes new trends toward the growing role of info-communications and incorporates past experience. In what follows, consideration is given to the importance and necessity of creating high-performance info-communications infrastructure to help the country resolve its problems and lead it toward this promising society of the 21st century. 1. Problems Facing Japan 1) Domestic Issues a. Dealing with the Aging Population Japan is not only a world leader in the longevity of its population, it is also subject to a downward trend in the birthrate. For this reason, Japan's population is aging at an unprecedented speed. According to estimates by the Ministry of Health and Welfare, 21.3% of the population will be aged 65 or over by the year 2010, at which time Japan will have a population with the highest proportion of elderly in the world. As the rapid aging of Japan's population proceeds, there are concerns about the future burdens on the medical and welfare systems, the declining proportion of the population in its productive years, a shortage of younger workers, and an ensuing decline in economic vitality. Accordingly, Japan has to promote the efficiency of the medical and welfare services and enhance productivity. b. Rectifying Overconcentration in Urban Areas The population of the Greater Tokyo Metropolitan Area (Saitama, Chiba, and Kanagawa Prefectures and Tokyo) alone accounts for more than 25% of Japan's total population. In addition, about 60% of companies capitalized at one billion yen or more are concentrated in this vast urban complex. Such overconcentration engenders a range of problems, including the difficulty of acquiring adequate housing in the metropolitan area, excessive distance and time spent in everyday commuting, problems in locating waste processing facilities, and increased fragility to natural disasters. In addition, it fuels spreading depopulation in regional areas and leads to population imbalances. A glance at the issue of excessive distance and time spent in commuting is sufficiently telling. In a 1990 study of commuters from outlying areas to Tokyo's 23 wards, 83% spent one hour or more in commuting, and 34% spent 90 minutes or more. One of the major factors causing overconcentration has been the Japanese socio-economic system, which has hitherto favored centralization. To ameliorate this burden, it is desirable that Japan's regional communities be rejuvenated by building a decentralized regional system which will thereby promote well-balanced development throughout the nation at large. c. Reforming Japan's Economic Structure The international competitive environment is changing in step with the progress of yen appreciation and the growth of the newly industrializing countries, and Japan is increasingly shifting its production facilities overseas, especially in the manufacturing industries where competitiveness has been declining. For example, Japan's direct foreign investment surged in the latter half of the 1980s to reach a record 67.5 billion yen in 1989. Subsequently, total direct foreign investment has been declining gradually. Nonetheless, the shift of production overseas is continuing at a fast pace, giving rise to fears of a hollowing-out of industry. For this reason too, it is imperative that Japan switch to a new highly productive framework for industry and employment, a framework centered on areas with high intellectual added value. According to a study by the OECD (Organization for Economic Cooperation and Development), if consumer price levels in the U.S. as of 1990 are indexed at 100, then consumer prices in Japan are at 143, clearly underscoring the fact that a great difference in price levels exists. It is thus necessary to bring about structural changes in industries, especially the distribution industry, in order to correct such differentials between domestic and overseas price levels and to enhance the living standard of the Japanese people. d. Realizing a Comfortable Lifestyle People's values of satisfaction with respect to their lifestyle are shifting from emphasis on "things" to "spirit" and from "volume" to "quality." According to a study entitled "Survey of Public Opinion Regarding People's Lives" conducted in 1993 by the Prime Minister's Office, a record 57.4% of the sample polled believed that there would be a future shift in emphasis to a spiritual quality of life in contrast to the previous emphasis on material wealth. What is particularly noticeable is the feeling of a lack of comfort in living conditions in contrast to fulfillment in terms of possession of clothes, food, and durable goods. People are increasingly calling for the creation of communities that give full consideration to low-income families, the physically disadvataged, or aged for undertaking measures to beautify their cities and to preserve and enhance the natural environment. Moreover, people are increasingly seeking more fulfilling types of human relationships in place of traditional communities. The sharing of information and knowledge is clearly likely to greatly contribute to qualitatively enhancing the lives of the Japanese people and to the formation of more diverse, stimulating communities. 2) International Issues a. Reforms Leading to a More Open Society Social and economic interdependence is growing as the international community becomes increasingly borderless, and Japan is expected to undertake reforms to increase the transparency of its socio-economic system, which will, in turn, lead to a society that is more open, externally and internally. Moreover, we have to consider the fact that Japan posted in fiscal 1992 a record trade surplus of $125.9 billion (the equivalent of 3.3% of nominal GNP). Expectations are placed on Japan to contribute to the stability of world economic development by shifting from an export-driven economy to an economy centered more on domestic demand. b. Promoting Mutual Understanding International interdependence is increasing and this is emphasizing the importance of mutual understanding of cultures. Japan is often said to be the source of only a relatively small amount of cultural information. For example, according to the Japanese government's "1993 White Paper on Info-Communications," in fiscal 1991 Japan's exports of visual materials (movies, TV, and videos) amounted to only 19.2 billion yen as opposed to imports of 51.8 billion yen in this area. Although exports of visual materials have shown a tendency to grow in recent years, it is estimated that in many cases, Japan purchases copyrights from abroad and then sells them for secondary use in other countries. It is important for Japan to ensure that its ideas and their cultural contexts are fully and clearly communicated to foreign observers and that the cultures of foreign countries are also properly understood in Japan. c. Addressing Environmental Problems When people have scaled down their activities so that their effects on the environment remain largely local and transient, such constraints on activities have generated a favorable environmental impact. Nowadays human activities have grown to a massive scale. Their potential effects, such as global warming or the reduction of biodiversity, have begun to give rise to fears of irreversible effects on the increasingly more delicate global environment. According to a report by the Intergovernmental Panel on Climatic Changes, if measures are not undertaken against the greenhouse effect caused by the increase in carbon dioxide, the mean temperature of the earth will increase by about one degree Centigrade by the year 2025 and about three degrees by the end of the 21st century. Similarly, sea levels will rise by about 20 cm by the year 2030 and by about 65 cm (or one meter at maximum) by the end of the 21st century. To ensure the lives of our future generations, we have to consolidate the knowledge of our best minds to build a worldwide environmental protection system. 2. The Role of High-Performance Info-Communications Infrastructure for Building an Intellectually Creative Society 1) From Conventional Industry to New Info-Communications Industry a. The Limitations of Conventional Methods Japan has up to the present sought to obtain material fulfillment by means of tailoring industrialization based on large-volume consumption of goods and energy. However, in the face of the wide range of intensifying problems described above, conventional methods, from which these problems are derived, are likely to be of no avail. For example, the creation of transportation infrastructure has resulted in the opposite effect of accelerating the overconcentration in metropolitan Tokyo. Similarly, increasing the consumption of energy is producing a deleterious effect on the environment. b. Approach from the Perspective of Info-Communications In view of the above factors, it is important to adopt the approach of using info-communications to resolve issues by creating knowledge and information in place of movements of goods and people and the consumption of massive amounts of energy. In other words, high-performance info-communications is capable of freeing people from the constraints of time and space and of enabling striking advances in the domain of human intellectual activities. As such, high-performance info-communications represents a new approach to resolving the broad array of questions Japan faces. Moreover, the creation of info-communications infrastructure is different from the building of conventional social infrastructure (For example, in metropolitan Tokyo, the construction of one kilometer of subway costs about 30 billion yen.); it offers an extremely high efficiency of investment and relatively small needs for outlays for sites, construction, inventory and personnel. 2) Transition to an Intellectually Creative Society a. Information and Knowledge as Resources The approach of capitalizing on info-communications means a change from the 20th century's dependence on goods and energy to the 21st century's focus on creativity born of information and knowledge. In the intellectually creative society based on high-performance info-communications expected in the 21st century, information and knowledge will necessarily become the most important social and economic resources, and the free creation, circulation, and sharing of these will become the very cornerstones of society. For example in the manufacturing industry, the cost of materials will in the future account for a smaller proportion of the value of production than ideas, design, research and development. In the area of consumption, needs for the accurate, rapid acquisition of information when purchasing goods and services will increase. Moreover, the possession of information will likely exert more positive effects on society than material wealth itself. b. The Importance of Info-Communications Infrastructure Japan needs to create a social environment that can fully capitalize on information and knowledge in order to resolve the increasingly more complex problems facing the country and to build a society that emphasizes intellectually creative activities. To facilitate this resolution, it will be essential to have a new, high-performance info-communications infrastructure in which both information and knowledge can be freely created, circulated and shared. Accordingly, a shift in perspective is already occurring in which the goods- and energy-oriented society is giving way to one oriented toward information and knowledge. Now, high-performance info-communications is the most important type of social infrastructure Japan can acquire as it works to build this new bright and discerning society to meet the challenge of the 21st century. 3. The Structure and Definition of Info-Communications Infrastructure 1) The Structure of Info-Communications Infrastructure When considering the creation of an intellectually creative society, it is essential to view info-communications infrastructure as a layered structure. The structure can be divided into four levels. Structure of Info-Communications Infrastructure Each of the four levels plays closely related, interdependent roles. They are most notably characterized as follows: Level 1, which comprises physical transmission media, is the basic underlying social infrastructure that enables the social utilization of info-communications capabilities. This level is subject to certain social requirements such as stable supply, fair use, and affordable tariffs. Levels 2 and 3, which assume the existence of level 1, are areas where the multimedia and new businesses will be generated. For that reason, they will be required to be highly versatile, innovative, and convenient. Level 4, where technologically feasible applications and services will be introduced to play essential roles in society, embraces personal values and an adequate legal framework, as well as an efficient and effective socio-economic system that decisively influences human activities. This is where the shift in perspective from conventional industry to new info-communications industry will take place. If we are to succeed in establishing an intellectually creative society in Japan geared toward the 21st century, we have to develop infrastructure from level 1 through level 4 as a whole. This paper will henceforth use "network" or "info-communications network" to refer to the media employed to circulate information in levels 1 and 2. "Info-communications system" will refer to those added in level 3. 2) The Definition of Info-Communications Infrastructure In view of the above, this report defines info-communications infrastructure as "a comprehensive entity that encompasses network infrastructure, terminals, software applications, human resources, public and private info-communications systems, as well as social values and lifestyles related to the information-oriented society." At the same time, the necessary conditions required for creating info-communications infrastructure will be cited in the following way: Anyone, regardless of where she/he is in Japan, should be able to enjoy their life, be able to secure employment, and have access to culture and cultural events at the same exceptional high level as anywhere else in the world. It is imperative that individuals, companies, and other organizations should conduct activities and achieve a balance between competition and coexistence in Japan as well as on the international stage.